The Rajasthan High Court issued a common order in response to two writ petitions filed by IDP Education India Pvt. Ltd., a subsidiary of IDP Australia. The dispute centered on how the services provided by the Petitioner—such as student counseling, placement, and enrollment support—should be classified under the IGST Act, 2017. IDP India rendered these services directly to its parent company, IDP Australia, which had separate agreements with foreign universities. As compensation, IDP India received a share of the application processing fee from IDP Australia.

 

The tax authorities treated these services as “intermediary services” under Section 2(13) of the IGST Act, which would disqualify them from being considered exports. Consequently, the Petitioner’s refund claim for IGST paid was denied. In contrast, the Petitioner asserted that its agreement with IDP Australia was strictly principal-to-principal (bi-partite), making it an exporter of services. This argument was supported by an earlier CESTAT ruling and a subsequent Bombay High Court decision in the Petitioner’s own case, both of which held that similar services qualified as exports and that the definition of "intermediary" under GST had not materially changed from the pre-GST era.

 

The Rajasthan High Court agreed with the Petitioner and allowed both writ petitions. It clarified that to be classified as an intermediary, a service provider must facilitate or arrange a supply between two distinct parties under a tri-partite structure. Since IDP India’s services were provided exclusively to IDP Australia, the arrangement was bi-partite and did not meet the definition of an intermediary.

 

Accordingly, the Court held that the services supplied constituted “export of services,” as the recipient was located outside India. These supplies, therefore, qualified as zero-rated under the IGST Act. Relying on the binding precedent from the Bombay High Court, the Rajasthan High Court set aside the impugned orders and remanded the matter to the Adjudicating Authority with directions to grant the refund along with applicable interest within four weeks of uploading the judgment.